Impediments to Microenterprise Development in Bahir Dar City, North-Western Ethiopia


  • Bekele Melese


Microenterprise, unemployment, urban poverty, job creation, Bahir Dar


Persistent unemployment and worsening poverty have become serious concerns in Ethiopia, particularly in urban areas. In response to this state of worsening poverty and unemployment, the country has been implementing microenterprise development program as a strategy to generate massive employment opportunities. The purpose of this article is to examine practical challenges and problems faced in implementing the program in Amhara National Regional State with particular reference to Bahir Dar city. To this effect, in-depth interview and focus group discussion along with document analysis were used to generate qualitative data pertaining to the day to day operations of the program. Participants in the interview and group discussions were selected using purposive sampling method considering their experience and knowledge about the program, and the data were analysed qualitatively. The findings reveal that microenterprises encountered a range of administrative and resource constraints including lack of credit, working premise and access to market. Most importantly, lack of experience and knowledge in running joint businesses and excessive dependence on government support were found formidable challenges emanating from the side of target beneficiaries. This paper shows that microenterprises provide temporary livelihood opportunities to the unemployed youth with likelihood of generating sustainable employment although limited in scope. Finally, the study recommends that a more sustainable approach to employment creation and poverty reduction would be directing resources to the promotion of large-scale industrial enterprises that could create sustainable employment opportunities.